First there is the confusion about the exchanges/marketplaces themselves; some states have their own exchanges, like Washington and Oregon, and 36 other states are relying on the federal government to provide the exchange at healthcare.gov. Once that is sorted out, then there are the major technical problems with virtually all of the exchange websites. If the website is not down for repairs or upgrades and can be accessed, then the problem becomes working with a site that has problems with freezing and programming errors. This does not include the very real problem with understanding the site itself and how specific questions must be answered to keep from getting kicked out of the process. Then, once you have successfully navigated the site, and maybe even determined your federal premium subsidy and applied for health insurance, you may find that the information provided to you was incorrect, as happened in Washington state this week.
“This week, Exchange staff uncovered and corrected a system error that has affected some 8,000 Washington Healthplanfinder applicants applying for qualified health plans. This error caused applicants to qualify for higher than expected tax credit amounts than allowed based on their income level or household size.” – Richard Onizuka, CEO for the Washington Health Benefit Exchange
Then there is the confusion about the individual health insurance mandate, effective for most Americans January 1, 2014. Many are still confused about whether or not they must buy a new plan or if their employer plan will meet the mandate, especially after receiving the federally required Exchange Availability Notice from their employer on October 1.
Eligibility for federal premium subsidies is another major point of confusion leading to frustration for potential health insurance consumers. Employees who have employer coverage that is affordable and meets minimum coverage standards are not eligible to receive a premium subsidy if they go to an exchange to buy insurance. While this is a surprise to many, these same families are just now coming to the realization that even though insurance through an employer-sponsored plan is not affordable for their dependents, it may be deemed to be “affordable” by the federal government. This disqualifies the employee’s dependents from receiving a premium subsidy to purchase coverage through the exchanges.
For this reason, many small employers who pay all or most of the employee premium, but do not contribute anything toward the dependent premiums, are considering dropping coverage altogether or offering employee-only plans with no eligibility for dependents. As confusing and convoluted as this sounds, it does free the dependents up to access premium tax subsidies if their total family income is between 138 percent and 400 percent of the federal poverty level.
Locally, after navigating the Washington HealthPlanFinder website, consumers in Clark County will find that there are only two mainstream insurance companies offering plans through the exchange, in addition to Community Health Plan, who is primarily a Medicaid provider. The two insurers – Lifewise Health Plan of Washington and Kaiser Permanente – are both fine companies, but do not necessarily offer access to the health care doctors and facilities the insurance buyer may be using today. The net result is that the consumer may have to change healthcare providers in order to use the insurance plan that qualifies them for a federal subsidy, or forego the subsidy and buy a plan from one of the several insurance carriers selling plans outside the exchange.
That fact itself is another point of confusion – whether or not health insurance may still be purchased outside of the exchange. The answer is that it can be, and at the same levels of coverage as plans purchased through the exchange.
As you can see, there are many points of confusion regarding the health insurance purchasing process, and what plan might be best for each individual health insurance consumer is not easily determined. Consumers will be pleased to know that professional local health insurance agents have spent many hours being trained and certified to assist with enrollment and to make recommendations as to which plan and purchase process will be best in each case.
Greg Seifert is the president and CEO of Vancouver-based Biggs Insurance Services.